🏥 After Transparency: Unleashing the Black Box

Diving into the Current State of Price Transparency and how leveraging the data unlocks significant unseen value for your provider organization

PARTNERED WITH Hospitalogists,   In late 2020, price transparency entered the healthcare industry in bombastic fashion.   Five years after implementation, we've seen price transparency evolve through many iterations into a useful strategic tool with practical applications across the enterprise. Now, with more robust datasets, a simple truth exists: the price transparency data published by payors today is more valuable than ever.   So today, I'm partnering with the experts at After Transparency—who analyze hundreds of trillions of healthcare payor pricing datapoints—to give you an in-depth look at the actual state of price transparency, including: Price transparency's beginnings in regulation and how the struggles that entrenched data companies have had in the past with the data has hidden payor price transparency's true potential; The state of the price transparency industry today and finally; How hospitals, health systems, and provider organizations of all sizes can leverage this information TODAY for significant financial upside and vastly better-informed strategic decision making. But first, who exactly is After Transparency?   After Transparency as a firm provides high touch, concierge-level payor price transparency services (data platform solutions partner) exclusively to provider organizations.   If you want the After Transparency team to get the right data in your team's hands and learn more about how you can leverage price transparency's capabilities across your enterprise for material upside, get in touch with their team today. They're already busy and about to get busier, so don't miss out.   I've gotten to know the After Transparency leadership team pretty well over the last couple of years and I can confidently speak from firsthand experience when I say they care DEEPLY about the providers (and ONLY providers) they serve. Not only are they extremely knowledgeable about the space they operate in, they're also great to talk with about everything going on in healthcare. You guys know I love a good healthcare thought exercise. So talking to them is a no-brainer in my mind.   Enough hoopla. Let's dive in. Was this email forwarded to you? Subscribe Here SPONSORED BY AFTER TRANSPARENCY Get more than payor price transparency data. Get results. After Transparency provides payor price transparency data solutions to providers (and ONLY providers). Their promise of concierge access to this data means you don't just get a login to a portal. You get:  Data formats that are easy to digest, use, and share A clear path to the answers you need Information and insights with less guesswork The support and assistance to drive real value from the data Your ability to address your strategic challenges and leverage payor price transparency data to your advantage is what drives After Transparency.  So, tell them about your unique challenges and obstacles. They're here to assist you! Share Your Needs The Current State of Price Transparency Payor Price Transparency, the Great Unlock: Executive Summary Based on a CMS rule changed in 2020 and reinforced in 2025, payors now have to publish negotiated healthcare services price information. We're at the point today where this data can be leveraged by providers for strategic purposes - both for more savvy rate negotiation but also strategic decision-making across the enterprise. Using the Payor Price Transparency data effectively is one of, if not the highest impact financial initiatives you can take on at a provider organization.  Payor Price Transparency data has been extremely useful in negotiations to change and unlock hard-fought negotiations.  Payors have been surprised that their own data can be used against them (but surprise for you: After Transparency points out that payors are buying this data from data vendors and using the information in negotiations to try to match rates with your lowest contract; it's time to put the negotiating power in your hands). Answers to questions that were unobtainable are now happening (e.g., "Do I have the highest ED rates in the state?", "Is another hospital carving out inpatient procedures in my state?", "Our hospital is getting asked to switch to OPPS (APC) billing by the payor; is that a good idea and what have others done?", "What services are my fellow hospitals pushing up rates for vs. other categories? Are they being strategic?"). If you haven't found effective footing with using payor price transparency data internally, or you've tried and failed in the past, you need to be working with someone like After Transparency - I highly recommend giving the data another shot. In the near future, the most sophisticated and forward looking provider organizations will use price transparency data to inform every strategic decision. Price Transparency's Beginnings: Empty Promises, Vague Requests, Consumer Focused The American consumer is woefully uninformed and ill equipped when it comes to any sort of pricing mechanism in healthcare. Copays, deductibles, and coinsurance muddy the waters and frustrate all of us. We have no idea what anything costs, and prices were always veiled between individual payors and providers through trillions of line items and CPT codes, each with their negotiated rate behind closed doors. So in response to this issue, but also as an attempt to re-introduce free market economic principles into healthcare, CMS unveiled new price transparency laws starting in 2020.   I can distinctly remember when the first price transparency rule came out. I was a healthcare consultant at the time who had just started this newsletter as a side hobby and glanced at a new headline. The Trump Administration, through CMS, would require hospitals to list certain 'shoppable' healthcare services on their website in machine-readable format.   "Wow," I thought. "This could really do something."   This first iteration in fact…did nothing.   But those initial regulations planted a seed, that over time, started to blossom into a little sapling. Over the past few years, CMS has been slowly making improvements to price transparency requirements.   Then, in 2022, CMS enacted the payor side of the Transparency in Coverage ruling. Payors were required to disclose commercial, closely held rates to the public at large, on their websites in a machine-readable format.   "This is it," I thought. "Healthcare's Eureka moment - finally." In my entire time in the industry I knew how powerful of a hold - how closely held to the chest - these commercial rates were.   You didn't talk about your rate.   You didn't try to renegotiate for fear of your payor contract getting terminated. And you definitely had no idea or insight into what the guy across the street was getting for the exact same procedure. There was - and is - an entire consulting practice built upon the commercial rate trade secret business. It's called a black box analysis. The project process goes something like this: A hospital decides to buy a physician practice or other services asset. They want to know what the rate differential is between their payor contracts and the asset's contracts they plan to acquire, so they engage a consulting firm with experience in these black box projects. Hospital A provides extremely sensitive rate information to a third-party consulting firm That firm typically has a database of expensive claims data that provide MSA or city level claims, purchased usually on a lagging, 18-month basis. The consulting firm then runs a financial model containing Acquisition Target B's procedures and applying Hospital A's rates to those codes, calculating the rate differential given Target B's case mix.   Can you guess what the entire deliverable is for this sophisticated, months-long black box project that costs thousands of dollars to complete?   A single table stating what the rate lift will be as calculated by the consulting firm. No supporting materials. Why? The information is too sensitive. So two potential business partners looking to combine refused to share rate information with each other in case the deal fell through, for no good reason other than the fear that a payor would find out, declare a breach of contract, and go out of network with them.   Because of my experience in the black box world of healthcare rates, I thought the payor files would be a huge unlock given how important topline revenue is to providers and given the fact that the data would no longer be a trade secret for any organization. Plus we're talking about one of the most impactful things you can do to increase your topline revenue - ask for higher rates!! But there has been far more inertia than I expected. This inertia is almost entirely predicated on behavioral change management and trust - along with some data capability requirement - more than anything else. Payor Price Transparency 1.0: Blue Screens of Death and Vendor Frustration Across the country from me in Kentucky, Abraham (Abe) Gage over at UofL Health (and countless other executives across the nation) had heard whispers of the coming promise of payor price transparency data. Years ago, Abe was in the car with a colleague and overheard a conversation with Pete Brumm, who would eventually become the Founder of After Transparency. Pete explained to Abe's colleague that the new rule would make all commercial rates available to providers and had seen promising results from a bit of data manipulation.   At the time, Abe chalked it up to nothing substantial. "Ahh, that's just another one of my colleague's crazy friends from Nashville." But the comments itched at him. What if they were accurate? It would be a huge gamechanger for his organization. Over the next few days, Abe dug deeper into the new developments. He owed it to his organization to look into the new ruling and see if there was actually something that would materially benefit UofL in a profound way from what that weird guy named Pete said.   So, Abe did what any normal person would do. He went to Anthem's website, pulled down the file for Kentucky, unzipped it, and queued up Python.   The next instant, Abe's computer crashed and his screen displayed an error message he'd never seen before: Classic healthcare, am I right?   Abe had just stumbled across what would become the first of many headaches in dealing with the promise of payor price transparency data. Files were MASSIVE - way too big for normal computers and, really, way too big for normal databases. As it turns out, file size was one of many initial problems (and still is today!). Provider organizations trying to access and interpret these initial datasets would find several challenges and stumbling blocks to getting the answers they were looking for: Fidelity of the first batch of data: CMS' specified format guidance was serviceable but open to interpretation, so data wasn't normalized. In one case, the entire file was unusable simply because the payor forgot to include closed brackets around certain parts of their code. Even today there are still problems or discrepancies within the datasets that After Transparency flags for regulatory bodies on a consistent basis. Sheer size of datasets, and different databases: With trillions of datapoints, and data uploaded on a monthly basis, providers needed specialized computers capable of handling large databases. It's not an Excel spreadsheet, fam. Lack of infrastructure: Given the complexity of combining fields across large datasets, health systems and smaller ambulatory providers lacked (and still lack!) the resources to turn the data into actionable insights. They didn't know what they were looking at, or how to access it, and couldn't hire internal data teams to figure it out. So what did they do? They turned to vendors. As Abe explained, to make the data accessible and usable for him, "We had to get our own internal development environment set up within our IT ecosystem, which was possible for us because we're a big academic healthcare center with some tenacious tech experts. For others, this would likely be a dead end." Reliance on traditional data vendors: Some providers didn't know payor data was even available to them. But for many of the provider groups that WERE aware of its availability, the only option was to outsource initial price transparency exploration to third party data vendors. Unfortunately, what they often got in return was disappointing results. In many cases, traditional sources of data delivered in a typical manner created frustration when the data was difficult to get insights from or wasn't easily usable. Maybe it was an issue of over-confidence, with some vendors thinking their team could do it but failing to deliver on the promise. Either way, because the data wasn't clean and these vendors misrepresented their abilities, provider organizations wasted money - hundreds of thousands of dollars - and saw no results from their efforts or investment during this time. With these initial failures, the payor price transparency trend took a major credibility hit and fell by the wayside. Additionally, newer specs around hospital transparency also clouded the story and some of those data vendors went after easier pickings for hospital contracts (e.g., we'll get your hospital data up-to-spec).   Where others were seeing challenges, organizations like After Transparency and champions like Abe were finding success. They were starting to pick up where other efforts were trailing off and losing steam. They were steadily building momentum, proving out the value of payor data, not getting distracted, and focusing only on supporting providers. And they were taking a different approach, convincing customers one by one, showing their numbers and validating that the data was usable and valuable.    Now, most of their conversations are helping potential customers overcome the hurdle that it's okay to open up the black box to renegotiate rates or leverage rate data elsewhere - and to be able to do so from a position of strength against payors and competitors. It is actually crazy to me how taboo and entrenched and secret all of this rate stuff is in healthcare. "The challenge we see is adoption - most companies are not good at putting data to use within their organization. They don't have the time, capabilities or understanding to fully integrate it - let alone create the compounding value we see with our long term clients." - the After Transparency team The Payor Price Transparency Paradigm Shift: New Use Cases to Unlock Significant Enterprise Value and ROI If I haven't made it clear yet, payor price transparency isn't just a regulatory requirement - it's a massive opportunity.   When providers have trustworthy, actionable data (and especially when they have experts like After Transparency not only getting them the right data, but guiding them on how to use it), they can quickly start to level the playing field. Getting more ROI for what they're already doing is certainly great - especially if there's a rate differential with the competitor across the street (which has literally happened, and which After Transparency has seen on nearly every project they have run in the past 3 years).   Provider organizations can also use the data to find new and better opportunities they couldn't leverage before. Here are a few examples: Rate Negotiation: the obvious one - I just felt like including it again. But not JUST rate negotiation. Now, equipped with data, provider orgs are able to tell when a payor is bullshitting them. With data, provider orgs can craft a compelling, data-driven narrative and explain exactly how and why they should get the rate lift - and identify specific (literally showing side by side rates with named competitors with data that is current to the current month or quarter), high-impact DRGs or procedures to drive outsized financial impact. It's also very helpful to understand what payors know about YOUR organization. You're able to have an even-keeled, meaningful discussion with payor partners based on objective reimbursement facts and not vibes. You can use the data to see if anyone in your market got an increase and use that as a talking point in negotiations. What you learn about your own payor price discrepancies or your local market's challenges can help you contribute to statewide conversations, such as within your associations (like the ACA or HFMA), about the successes and failures of dealing with payors and payment trends. And there could be information that helps you overcome particular struggles in a certain segment. For example, Pete says After Transparency has been involved with many providers in orthotics and prosthetics, delivering essential data for years. This is important because private insurers generally pay more than Medicare, but in orthotics and prosthetics the opposite is frequently true. They're one of the few industries that are a percent under Medicare. They receive 60% of Medicare rates because they are treated as a parts supplier instead of a custom fitting multiple visit specialty group. Other providers are getting 150% of Medicare and also get to charge for the visit. That's a huge discrepancy that After Transparency is trying to help them overcome. For After Transparency specifically, several providers have found they were severely under market and have negotiated successful rate increases of 45%, 76%, 88%, 100% and even 147% for their largest respective commercial payors. In their first pass with After Transparency, one academic health system in a metro area was able to get rate lifts immediately off the bat starting at 4% and eventually reaching just shy of 50% on certain identified DRGs with high margin erosion risk (ones with more exposure to changing prices in medical supplies and other highly variable cost inputs). And one rural hospital received a 125% increase the first year. With results like these, it's pretty easy to see how quickly you can leverage this data for a plethora of similar use cases. Don't worry - I'll dive into more nuanced use cases and ROI case studies in part 2 of this payor price transparency story with the After Transparency team.  Market Development: For strategy teams thinking about an acquisition, or developing a new imaging center in a certain market, you have immediate access to both competitive intel (what is everyone else getting on rate) but also whether the rate makes the project or M&A viable in the first place. Pricing is the number one variable and input you need to know when making these decisions, and payor price transparency data unlocks these decisions in a big way. Benchmarking: These datasets allow organizations to define their own markets rather than predefined payor ones or something in-between, leading to more robust and accurate benchmarking on pricing. Understanding Quality Investment: Many payors have quality tracks and provide incentives for undergoing the upfront costs. Transparency data allows teams to better understand the ROI of these decisions. Provider organizations can identify a payor's distinction program in a certain specialty - let's say spine - then calculate whether there's a statistically significant difference in reimbursement over time for hospitals that participate in that quality program. Transparency data makes these types of decisions much more black and white. Respond Nimbly to Rapid Change: With key regulations like the Big Beautiful Bill or mandatory bundled payments or OPPS and IPPS updates, hospitals and health systems can respond much more flexibly and move faster to scenario plan for these changes if there's an infrastructure to support price transparency models. Whether you get the rate lift or not, you can understand how much you need to make up given a certain level of cuts to Medicaid reimbursement, supplemental dollars, or Medicare payment updates. Future Proof your Organization: Given recent updates to price transparency requirements, the ongoing move to enterprise-wide strategic decision-making (not just in service line siloes) and the bipartisan nature of transparency in coverage, investing in payor price transparency infrastructure will be a key way to future proof provider organizations. Having data available in near-real time to make decisions will provide a compelling competitive advantage over peers in your markets. Payor price transparency data will eventually be integrated into the way most providers, payors and the services that support them use data in general. This will be especially true anywhere that claims data, market data and other similar data is currently leveraged. So get ready for this future. How You Can Stay One Step Ahead of Payors and Peers with After Transparency Like I've mentioned, over the past couple of years and more acutely over the past month of talking with the After Transparency crew (Jon, Pete, and the rest of the gang), it's become apparent to me how quiet and unknown the payor price transparency data capabilities are that continue to only get better over time.   If you take away nothing else from this piece, I want you to remember this: you NEED to incorporate payor price transparency data - and its future iterations - into your future strategy planning in order to future proof your operations. And if you haven't already done so, After Transparency can help.   Who better to work with than the team that is correcting the reported rates to help out their customers and regulatory bodies (and submitting those changes pro bono just because it's important for the industry and they're the team with the skills and data to back up their proposed changes)?   Here are a few other differentiators for you guys to check out: Payor price transparency data is growing in sophistication and usability, and guidance updates are constantly happening. Being an early adopter of its value is key. The more trustworthy that data becomes and the more providers learn of its value, the more it will get used. And if you aren't leveraging payor transparency data today, you are currently blind to a huge input (local market rates) on things such as new market entry go / no-go decisions for new ambulatory market developments along with other strategic blindspots in the not-so-distant future. Price is an incredibly important variable to understand enterprise-wide, after all.   By the time you figure out how behind you are, those competitor facilities will have been built and your opportunity will have vanished.   The good news is that you still have time to get ahead of the curve. Providers hold a huge opportunity to even the playing field with payors on the data side of things and get ahead - or get even - with competitors in their markets.   Users of payor price transparency data need clarity about and trust in the data they're given, someone they can count on to provide the data in manageable, easily accessible, usable chunks, and guidance on how to use the data to uncover actionable insights and maximize opportunities. That's exactly where After Transparency steps in - as a guide, a partner, and a trusted data platform.   Through a track record of success stories, the team already has a steady pipeline of work through simple word of mouth as they look to ramp up even more. More than anything, After Transparency just wants you to be aware of the opportunity cost of not engaging payor price transparency data in a meaningful way. Of course they'd be ecstatic if you engaged their firm. But really, their core mantra is simple: this is an extremely powerful and useful tool for providers to leverage strategically - enterprise wide - and providers should leverage the information in pretty much every single decision made for the organization.   Schedule a meeting with the After Transparency team. I have only good things to say about everyone I've met at the organization, and the conversation will pay for itself - maybe even a few $million times over. SPONSORED BY AFTER TRANSPARENCY Unlock the full potential of payor price transparency data. After Transparency is your solution partner to get payor price transparency data and put it to work for you.  Find the answers to your strategic questions and the insights you need  Level the playing field in negotiations Know where you stand against your competitors Gain perspective on a new market or service's potential before diving in Whether you've struggled with payor price transparency data in the past and/or you're ready to unlock its true value now, After Transparency can help. Get Answers Inside the Hospitalogy Community Some highlights from around healthcare and my private Hospitalogy Membership 🏥 💬 Our Community is Evolving I don't like noise. If I'm doing something, I want it to mean something.   So, we ditched the like button and emojis in our Hospitalogy Membership feed in favor of personalized reactions, DMs and easier ways to reply privately. Less noise. More substance. See the difference!   Not a member? If you're in strategy, finance, or ops at a hospital or health system, apply here to join us! MISCELLANEOUS MADDENINGS Random personal anecdotes and musings from me See you guys Thursday - we'll be checking in on Tom and Lumeris and all things primary-care-as-a-service. Don't miss it! Thanks for the read! This one was a doozy. Let me know what you thought by replying back to this email. If you read all the way to the bottom you're one of the real ones. I appreciate u.   — Blake   Get your brand in front of 46,500+ executives and healthcare decision-makers. Let's Partner → 🏥 Hospitalogy Membership I'm building a community of leaders in strategy, finance, and ops at hospitals and health systems to help us connect, learn, and grow together. Join the movement here. Workweek Media Inc.  1023 Springdale Road, STE 9E Austin, TX 78721   Want to ruin my day? Unsubscribe.